Vol. XXII, No. 136 [ BusinessWorld Online ]
Wednesday, February 11, 2009 | MANILA, PHILIPPINES
MAKATI CITY will be implementing three-year moratorium on real property and business tax hikes to help residents and businesses cope with the economic crisis.
"We realize that this is not the time for the city government to further burden our business partners," Makati Mayor Jejomar C. Binay said in a statement.
"We believe that the city government’s revenues are sufficient at the moment to sustain the level of services we provide our constituents," he added.
The proposal was said to be part of the city government’s response to concerns raised by business leaders in a crisis conference last month.
It was unclear if the city council had already passed an ordinance implementing the incentives scheme.
During last month’s meeting, businessmen urged Makati officials to consider tax perks and reduced permit requirements.
Mr. Binay yesterday said companies that participate in a retraining program and hire residents would be eligible for permit tax discounts.
Companies, he added, should help the city government map out an employment plan for qualified residents. Participation in the latter will be "voluntary, but those who do sign up will be eligible to certain incentives".
The city-run University of Makati, Mr. Binay added, will provide "training for employable skills at no cost to the hiring company".
He cited existing university partnerships such as one with fast-food giant Jollibee where students are trained to become store managers.
Along with Jollibee, three other firms — Shakey’s, Figaro and SM Investments — were said to have been tapped to develop a food service sector-targetted curriculum.
Fujitsu Philippines was also said to be training 75 students to speak Japanese with the promise of employment in Japan.
Sought for comment, Makati Business Club Executive Director Alberto A. Lim said a moratorium would help but is not enough.
"We are grateful for that but right now, what we need is a reduction of taxes," he said in telephone interview.
He noted that businesses have forecast profit drops over the next two to three years given expectations of a protracted downturn.
"Reduction of taxes is needed in order to help employees keep their jobs and save companies from closing shop," Mr. Lim said.
Makati, the statement said, expects to earn P7.1 billion this year. — L. D. Desiderio
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